After months of discussion, a study by Aqua Tech, and a public meeting the Augusta City Council voted 7-0 to propose a one-cent sales tax to voters.
Ninety percent proceeds of the sales tax, if approved, would fund water system improvements to include a new 24-inch water line to El Dorado. Other improvements to the water system could include using the Walnut River to keep the Augusta City Lake full and other projects.
But the primary reason for the sales tax would be to fund the new water line. The 60-year old line to El Dorado can only safely deliver about 2.5 million gallons per day to the community. During most of the year, that amount of water is enough to satisfy the demand from the 3,500 Augusta water customers, two water districts and the City of Mulvane.
But during peak usage, it is not uncommon for the demand to exceed 4 million gallons per day. The supplemental water comes from Santa Fe Lake and the City Lake. However, in times of drought like Augusta has experienced in the past two years, those sources can be compromised, forcing Augusta residents to conserve water.
The cost of the project is expected to be around $20 million. Under long-term funding plans, the city would need about $1.1 million per year to repay the debt. Ninety percent of a one-cent sales tax is expected to bring in almost $800,000 per year with the rest expected to be raised through property tax increases or water service charges.
If the voters reject a sales tax, the project would probably remain on the city's radar – only another funding mechanism would be required.
"If the sales tax question fails at the ballot, we'll have to take a hard look at our other funding options," Mayor Kristey Williams said. "Including the addition of water fees and a mill levy increase. From my perspective, a 1 percent sales tax is the best option for building a funding stream as we plan for our water future."
City Manager Bill Keefer agreed.
"I do not think that doing nothing is an option," he said.
The other 10 percent of the funds raised by the tax would go into the general fund.
This is required by statute. If a sales tax is going to extend beyond 10 years, it has to be for general use and not a specific project.
Under the plan going to the voters, the governing body would choose how to allocate those funds each year.
Some of the projects that might be targeted for these funds include parks and recreation, economic development, streets, or other needs the city may have.
Augusta resident Rob Schmidt attended Monday's meeting where the council approved the resolution to send the sales tax to a vote and asked the council to reconsider its options.
Page 2 of 2 - He said he worried that Augusta approving a sales tax for this project would negatively impact negotiations with Mulvane, whose contract to buy water from Augusta expires in 18 years.
"Maybe we would be better off to wait until then rather than to pass this without any agreement in place," Schmidt said.
He also said his understanding was that the city could provide enough water for the citizens to use every day but that watering lawns in the summer caused the city to demand more water than the El Dorado line can provide.
"Only 11 percent of the water customers have a sprinkler system," he said. "Why should the other 89 percent have to pay for that 11 percent to overuse the water from the city."
Keefer responded to Schmidt by saying that he didn't believe the water line would even function in 18 more years.
"As time goes on, that capacity is only going to shrink," Keefer said. "It is limited already. That's just the nature of the beast."
The new line to El Dorado could carry as much as 7 million gallons per day to Augusta.
"This is about being able to supply the basic needs of the community over the next 10 to 20 years," Keefer said.
Councilor Ron Reavis pointed out that the 30-year period for the tax is not written in stone.
"If we partner with Mulvane or get grants to pay it off early, the tax would go away," Reavis said. "Nothing in the resolution says that we have to continue it for 30 years if we don't need it."
The election will be part of the Nov. 6 general election ballot.
The resolution passed the council 7-0. Matt Malone missed his first meeting since being elected in 2011.